Simplify and Optimize Automotive Logistics with Labeling
by Harald Desjarlais, on February 14, 2017
We often get questions about the sheer complexity of the automotive supply chain with its broad range of players, including OEMs, sub-tier suppliers, warehouse and transportation managers, distributors, retailers, and end consumers. People ask "how can labeling help solve the growing challenges with automotive logistics?" Well, if you think about it, at the core of your materials flow is the label, which serves as the identifier of the product, determines its destination, and carries a variety of data required to assure that it is successfully received and processed. Each step requires accurate barcode labeling for faster, more efficient processing as well as precise track and trace of so many parts and assemblies along the way.Since the data carried on the label inevitably finds its way back into an inventory, WIP, or warehousing system, it's the label that is the crucial component in providing an accurate snapshot of present state inventory across the enterprise. The cost of label inaccuracy is significant, yet most companies do not measure it effectively. There are substantial gains in assuring label accuracy, and many companies might be surprised at the bottom line impact of not having this assurance. For example, recently a company determined that an accurate and ongoing perspective of the inventory in its supply chain—realized by the data gathered from its labels—would enable it to reduce safety stock conservatively by three days freeing up several million dollars of capital. An enterprise labeling system will be at the core of this solution.
At the same time, companies are dealing with customer-specific requirements that are increasing at a rapid rate. You’re seeing more and more customers (whether they’re OEMs, next-in-line suppliers, or resellers) demand that graphics, translated text, branding, and more be added to their labels. As a result, the burden of creating and maintaining compliant labels has become increasingly demanding and costly—with some companies managing a staggering amount of label templates to capture all these requirements.
Adding to this complexity is an ever-increasing amount of redundancy as companies rely on a variety of disparate labeling solutions across global locations, each providing identical label design and maintenance in a completely siloed, disconnected fashion. Some companies even use different barcode label software solutions for different purposes within the same facility: distribution labels for one, shop floor labels for another. This approach drains resources and flies in the face of trying to simplify automotive logistics and gain efficiencies in a complex global supply chain.
Which brings us to the inherent business benefits of a standardized enterprise labeling solution. By taking a holistic, integrated approach to labeling, automotive companies can respond quickly to new and evolving requirements, like AIAG barcode standards, while maintaining labeling consistency across the supply chain. Dynamic, data-driven capabilities allow OEMs, suppliers, and even warehouse distributors to take control of labeling—with fewer templates—and achieve dramatic reductions in overall maintenance and the costs associated with it.
How else can labeling drive significant efficiencies in your auto supply chain? Find out in this new Q&A report "5 Burning Questions (and Answers) on Automotive Labeling." You'll learn that the right labeling solution can pay huge dividends—now and for the long run.